LOJ acquires First Life
LIFE of Jamaica yesterday confirmed that it will purchase the insurance business of First Life, as well as its interest in Pan Caribbean Financial Services, once the merger between Pan
Carib and Manufacturers Sigma Merchant Bank is complete.
To effect the acquisition, Life of Jamaica will issue new shares to First Life, as well as to pay an undisclosed amount of cash to the shareholders. With this transaction, First Life shareholders will own 25 per cent of the shares in LOJ.
Currently, the Barbados-based Sagicore owns just under 80 per cent of LOJ shares. Its shareholding will fall to about 60 per cent, according to a joint statement from LOJ and First Life.
First Life is expected to control 38 per cent of the enlarged entity that will result from the merger of its subsidiary – Pan Caribbean Financial Services – and Manufacturers Sigma Merchant Bank. That shareholding will now be acquired by LOJ as part of this latest deal.
Yesterday’s announcement followed an Observer report in early January which said that both institutions were to fully merge and that Richard Byles, the executive chairman of First Life was to take over as the CEO of the enlarged entity. The present CEO of Life of Jamaica is Canadian, Maxine McLure.
The companies said yesterday that the auditing firm, PricewaterhouseCoopers had carried out independent valuations on First Life, LOJ, and Pan Caribbean, and that another expert opinion would be sought.
“Standard and Poor’s Corporate Value Consulting are to be asked to render their opinion regarding the fairness, from a financial point of view, of the consideration to be paid in connection with this acquisition,” the companies said.
The transaction is subject to regulatory approval.
“The transaction will consolidate LOJ’s position as the largest and most profitable life insurance company in Jamaica and gives it a substantial shareholding in a major banking entity,” said the companies.
The announcement was made after the close of trading on the Jamaica Stock Exchange where First Life, LOJ, and Pan Caribbean are listed.
